Grainville School (Phase 4) Contract: Reinstatement of Employment of Charles Le Quesne (1956) Limited (In Liquidation)

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A decision made 26 August 2011 regarding:

Decision Reference: MD-TR-2011-0115
Decision Summary Title:	Proposed Re-Employment of Charles Le Quesne (1956) Limited (In Liquidation) on the Grainville School (Phase 4) Contract		Date of Decision Summary:	24 August 2011
Decision Summary Author:	Assistant Director, Jersey Property Holdings		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Proposed Re-Employment of Charles Le Quesne (1956) Limited (In Liquidation) on the Grainville School (Phase 4) Contract		Date of Written Report:	24 August 2011
Written Report Author:	Assistant Director, Jersey Property Holdings		Written Report : Public or Exempt?	Public
Subject: Proposed Re-Employment of Charles Le Quesne (1956) Limited (In Liquidation) on the Grainville School (Phase 4) Contract
Decision(s): The Assistant Minister, under his delegated authority approved the re-employment of Charles Le Quesne (1956) limited (in liquidation) on the Grainville School (Phase 4). The decision will be effected by signing an Agreement in the form attached as Appendix A to the report.
Reason(s) for Decision: The reinstatement of the employment under the same terms and conditions offers the greatest benefit to the parties to the contract. All funds generated under the contract will be 'ring fenced' by the Liquidator to pay disbursements due until such time as the contract is completed.
Resource Implications: None beyond those already in place under the terms of the original contract
Action required: Assistant Minister to sign an agreement to reinstate the employment of Charles Le Quesne (1956) Limited (in liquidation) on the Grainville School (Phase 4) contract.
Signature:		Position: Connétable John Refault, Assistant Minister for Treasury and Resources
Date Signed:		Date of Decision:

Grainville School (Phase 4) Contract: Charles Le Quesne (1956) Limited (In Liquidation) - Re-Employment

TREASURY AND RESOURCES DEPARTMENT

JERSEY PROPERTY HOLDINGS

Property Transaction for Ministerial Decision - Minister for Treasury and Resources

Subject: PROPOSED RE-EMPLOYMENT OF CHARLES LE QUESNE (1956) LIMITED (IN LIQUIDATION) ON THE GRAINVILLE SCHOOL (PHASE 4) CONTRACT

Purpose

The Assistant Minister is asked to approve the proposed re-employment of Charles le Quesne (1956) limited (in liquidation) (“C Le Q”) on the Grainville School (Phase 4) contract.

Background

C Le Q was placed into “Just and Equitable Winding-Up” under Chapter 3 of Part 21 of the Companies (Jersey) Law 1991 on 27th July 2011. As a result of the winding up order the employment of CLeQ under this contract is automatically determined however the contract remains active.

The winding up order makes provision for CLeQ to continue this contract, together with a contract for the Housing Minister for the refurbishment of Clos Gosset. Under the terms of both contracts the States have the option to reinstate the employment of CLeQ or employing others to complete the works.

It is the reinstatement of the employment under the same terms and conditions which offers the greatest benefit to the parties to the contract. In pursuing this option, all funds generated under the contracts will be 'ring fenced' by the Liquidator to pay disbursements due until such time as the contract is completed.

Officers of JPH, Housing and the Law Officers Department have met with representatives of CLeQ and the appointed Liquidator to determine a way forward to reinstate the contractor’s employment under the contract on the original terms and conditions.

Proposal

The proposal to re-employ CLeQ is contained in an Agreement attached as Appendix A to this report. The Agreement has been reviewed for technical accuracy by JPH and approved by the Law Officers Department.

The effect of the Agreement is to re-employ CLeQ on the terms and conditions contained in the existing contract, with payment being made to the liquidator and held for disbursement to employees, sub-contractors, suppliers and other parties. Only when the contract is fully discharged will funds held be released for payments by the liquidator to creditors of CLeQ.

Written confirmation has been received from all bar one of the Sub-Contractors under the Grainville School (Phase 4) contract that they are willing to accept the reinstatement of their employment under the terms of their sub-contract agreement. The outstanding Sub-Contractor has given a verbal assurance that he is willing to continue.

All of the surety under the existing contract will be maintained, including continuation of the performance bond throughout the contract and the defects liability period. CLeQ has made provision for resources to be available to attend to any defects arising during the defects liability period.

CLeQ has been approached to determine whether it is possible to obtain an insurance guarantee to cover the 10 year ‘latent defects’ period after completion of the works. It is proposed that to provide certainty of continuation on site, this issue should not be a barrier to the signing of the Agreement as it is understood this could take sometime to resolve.

Recommendation

That the Assistant Minister, under his delegated authority approves the re-employment of Charles le Quesne (1956) limited (in liquidation) on the Grainville School (Phase 4) contract by signing the Agreement attached as Appendix A.

Written By: Assistant Director JPH

Signature …………………………

Authorised By: (Director/Assistant Director JPH)

Signature ………………………… Date 24 August2011

Appendix A

RE-INSTATEMENT AGREEMENT

BETWEEN:-

(1) CHARLES LE QUESNE (1956) LIMITED (in liquidation) acting by its Joint Liquidators Adrian Rabet and Dermot Boylan, of Messrs Moore Stephens

-and-

(2) THE MINISTER FOR THE STATES OF JERSEY FOR THE TREASURY AND RESOURCES DEPARTMENT

This Re-instatement Agreement is made the day of August 2011

BETWEEN:

(1) CHARLES LE QUESNE (1956) LIMITED (in liquidation) (company number 704) whose registered office is at 95/97 Halkett Place, St Helier, Jersey, JE1 1BX (“the Contractor”) acting by its Joint Liquidators Adrian Rabet and Dermot Boylan (“the Joint Liquidators”), of Messrs Moore Stephens, First Island House, Peter Street, St Helier, Jersey JE4 8SG

AND

(2) THE MINISTER FOR THE STATES OF JERSEY FOR THE TREASURY AND RESOURCES DEPARTMENT (“the Employer”)

WHEREAS:

(A) Until 27 July 2011 the Contractor carried on the business of a building contractor and related ancillary businesses.

(B) The Contractor issued a Representation dated 26 July 2011 in the Royal Court of Jersey seeking a Court order for it to be wound up on the just and equitable basis and on 27 July 2011, the Royal Court granted an order for the Contractor to be wound up under Chapter 3 Part 21 of the Companies (Jersey) Law 1991.

(D) On 27 July 2011 the employment of the Contractor under the terms of the contract entitled Standard Form of Building Contract 1980 Edition Local Authority With Quantities” dated 27 August 2010 (“the Contract”) was automatically determined pursuant to Clause 27.3.3 of same.

(E) On 3 August 2011 the Employer agreed to a retrospective interim arrangement of the Contract from 27 July 2011 to expire at 17.00 hours on 12 August 2011. The interim arrangement allowed for the interim re-instatement of the Contractor’s employment (in liquidation).

(F) On 12 August 2011, the Employer agreed to an extension of the interim arrangement to expire at 17.00 hours on 19 August 2011. This interim arrangement was further extended on 18 August 2011 to expire at 17.00 on 26 August 2011.

(G) The parties wish to execute this Agreement, to confirm the re-instatement of the employment of the Contractor (in liquidation) under the same terms and conditions as set out in the Contract.

NOW THIS RE-INSTATEMENT AGREEMENT WITNESSES AS FOLLOWS:

In this Re-instatement Agreement and the recitals hereto the following terms shall have the following meanings:

The Contractor: Charles Le Quesne (1956) Ltd (in liquidation).

The Joint Liquidators: Messrs Adrian Rabet and Dermot Boylan of Messrs Moore Stephens.

The Employer: The Minister for the States of Jersey for the Treasury and Resources Department.

The Contract: Standard Form of Building Contract 1980 Edition Local Authority With Quantities dated 27 August 2010.

Re-instatement: the re-instatement of the employment of the Contractor under the same terms and conditions contained within the Contract. The re-instatement of the Contractor’s employment (in liquidation) is deemed to retrospectively take effect from 27 July 2011.

The Royal Court Order: Order of the Royal Court dated 27 July 2011 (Court File Number: 2011/296).

The Employer agrees and undertakes that he shall do all such things and sign and execute all such documents or further documents as the Contractor may reasonably request in order to enable the Contractor to exercise and/or enforce the rights, benefits and powers conferred upon it by the Employer and/or in order otherwise to give effect to this Agreement.

The Contractor agrees and undertakes that it shall do all such things and sign and execute all such documents or further documents as the Employer may reasonably request in order to enable the Employer to exercise and/or enforce the rights, benefits and/or in order otherwise to give effect to this Agreement.

If any provision of this Agreement (or any part of any provision) is or becomes illegal, invalid or unenforceable in any jurisdiction, that shall not affect:

a) the legality, validity or enforceability in that jurisdiction of any other provision of this Agreement (or part thereof); or

b) the legality, validity or enforceability in any other jurisdiction of that or any other provision of this Agreement.

This Agreement shall be governed and construed in accordance with the laws of the Island of Jersey and the parties hereto irrevocably submit to the non-exclusive jurisdiction of the Courts of Jersey.

IN WITNESS whereof this Agreement has been duly executed as an Agreement and delivered the day of August 2011.

…………………..

Mr Dermot Boylan Date:

Joint Liquidator

…………………….

The Minister for the Date:

States of Jersey

Treasury and

Resources Department

AS WITNESS THE HANDS OF THE PARTIES HERETO

…………………... ……………………...

Witness on behalf Witness on behalf

of the Contractor of the Employer

Full name in print Full name in print